Price/Earnings Growth Ratio

#1
hi

Experts pls help . i need to calculate Price/Earnings Growth Ratio, where i can get the details on estimated annual eps growth rate

vinu
 
#4
Try this link

http://www.investopedia.com/terms/p/price-earningsratio.asp

In simple terms-

A company's (or stock's) worth to a buyer can be judged by how cheap or expensive it is.
PE ratio if high, means more people value the stock more than its earnings. For example, stock price for Bling is 20 and its earning per share is 2, then the PE is 10. This means people are paying less money for the earnings. However, if the price was 40 and the earning per share still 2, then the PE would be 20, meaning people are paying more money for less earnings.

Basically PE gives you the valuation of the stock.
 
#6
Try this link

http://www.investopedia.com/terms/p/price-earningsratio.asp

In simple terms-

A company's (or stock's) worth to a buyer can be judged by how cheap or expensive it is.
PE ratio if high, means more people value the stock more than its earnings. For example, stock price for Bling is 20 and its earning per share is 2, then the PE is 10. This means people are paying less money for the earnings. However, if the price was 40 and the earning per share still 2, then the PE would be 20, meaning people are paying more money for less earnings.

Basically PE gives you the valuation of the stock.
I know P/E are compared sector wise....... some sectors have inherently low P/E while others have high.

but form the expaination above, to a beginner like me it seem like ....... If I want to buy shares of x and y companies ( same sector) I sud go for shares with low P/E value???
 

nda

New Member
#7
Hi Vinuvt, if you are looking at estimating EPS growth rate for any particular company, look at its past EPS growth rate or BVPS growth rate for guidance. You can get EPS and BVPS info for past few years online from which you can arrive at their past growth rates. For sectors that are visible, like software, you do get analysts prediction of Estimated EPS growth rates for the next 5 years. Just do an online search for it. Hope this helps.
 

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